Trenton, N.J .The New Jersey Supreme Court disciplined 198
attorneys in 2000, according to a report released today by the Supreme Court's
Office of Attorney Ethics (OAE). A total of 162 attorneys received final
disciplinary sanctions, while another 36 were the subject of emergent temporary
suspensions.

This year's figure represents a decrease from the 1999 figure of 239
total sanctions, which was the highest number of sanctions recorded in a year
(a tie with 239 in 1997).

During 2000, disbarments increased by 12 percent from the previous year
(46 in 2000 vs. 41 in 1999). At the same time, suspensions decreased by 39
percent, from 73 in 1999 to 44 in 2000.

Despite this decrease in total disciplinary sanctions, the number of new
grievances filed against attorneys increased in 2000 over those filed in 1999.
A total of 1,320 grievances was docketed during 2000, compared to 1,294 the
year before.

The statistics are included in the OAE's 17th annual report to the
Court. The OAE serves as the Supreme Court's investigative and prosecutorial
arm in attorney-discipline matters. The report also includes information on the
attorney fee arbitration process, random audit program and the annual attorney
registration process. The text of this report is available online at the
Judiciary Web site, www.judiciary.state.nj.us.

The disciplinary system, the fee arbitration process, the random audit
program and the annual attorney registration process are financed through
annual assessments paid by attorneys. At the end of 2000, there were 72,738
lawyers admitted to practice in New Jersey, compared with 41,166 at the end of
1990.

Since 1994, there has been a dramatic increase in the number of
grievance investigations being handled within the time goals set out by the
Supreme Court - six months for standard investigations and nine months for
complex matters. At the end of 1994, 43 percent of all grievance investigations
met the goals. At the conclusion of 2000, 83 percent of all investigations
complied with the goals.

The success in meeting time goals corresponds to changes the Court made
to the system in July 1994 when, for the first time, the Supreme Court
authorized full-time investigators to handle approximately one-fourth of all
attorney-discipline cases in the state. Since March 1995, full-time
investigators have conductedinvestigations of attorneys in the
disciplinary districts of Essex-Newark and Camden-Gloucester Counties and some
of the investigations in Ocean County.

In all other districts, investigations are undertaken by attorney
volunteers who are also supported in the hearing process by volunteer public
members. The report commends their efforts as well. The OAE continues to handle
the most complex cases and those requiring immediate attention.

The timeliness of hearings, where attorneys are tried on charges of
unethical conduct, has also improved during the last six years. In 1994, only
37 percent of hearings were concluded within the Court's six month time goal.
In 2000, that compliance rate increased to 59 percent statewide.

OAE Year 2000 Report Highlights

Public Discipline

In 2000, 198 attorneys were finally (162) or temporarily (36)
disciplined. There were 46 disbarments (19 by opinion of the Supreme Court and
27 by consent of the attorneys), 44 final suspension orders of various lengths,
48 reprimands, and 24 admonitions (the least serious discipline sanction
imposed). Additionally, 36 attorneys were either temporarily suspended from
practice or otherwise disciplined on an emergent basis.

Last year, 239 attorneys were disciplined (185 final and 54 through
temporary suspensions). There were 41 disbarments (22 by opinion of the Supreme
Court and 19 by consent of the attorneys), 73 final suspensions, 48 reprimands,
and 23 admonitions.

In 1998, 185 attorneys were sanctioned, 160 through final discipline and
25 who were subject to emergent temporary sanctions. Of those, 39 were
disbarred (22 by opinion of the Supreme Court and 17 by consent of the
attorneys), 43 received final suspension orders, 49 had public reprimands, and
29 were admonished. In 2000, gross and patterned neglect of clients' matters
continued as the top cause of attorney discipline. It was cited in over 25
percent of the final discipline cases.

Next was knowing misappropriation of trust funds which occurred in
over 20 percent of these cases. Of those attorneys publicly disciplined in 2000
for knowing misappropriation, six were detected through the OAE's Random Audit
Compliance Program and disbarred. The OAE's Trust Overdraft Notification
Program resulted in five disbarments for knowing misappropriation of clients'
funds in 2000.

That program requires all financial institutions to report to the OAE
whenever an attorney overdrafts an attorney trust account or any time a check
is presented against insufficient funds. Other money offenses, including
negligent misappropriation, record-keeping and escrow violations, accounted for
more than 10 percent of cases where lawyers were disciplined.

The number of disputes
submitted to New Jersey's program to arbitrate disagreements over attorney's
fees was 1,232 in 2000, according to the OAE report. In 1999, 1,289 fee
disputes were submitted to the program.

The report states, "When one considers the hundred of thousands of
civil, criminal, equity, small claims and municipal court matters that are
filed with the courts, and the hundreds ofthousands of non-litigated matters ... handled annually by New Jersey
lawyers, it is clear that the number of fee arbitration matters filed is a very
small percentage of the total number of attorney-client transactions." The
report also notes that the 1,232 fee disputes represent only 2.2 percent of the
active New Jersey lawyer population.

In New Jersey, lawyers are required to submit their fees to review by an
arbitration committee at the request of a client. Under the program, the
attorney has the burden of proving that the fee charged was reasonable. New
Jersey is one of only 10 states to have a statewide, mandatory fee arbitration
program.

Since participation in the fee program is mandatory on the part of
lawyers, clients requesting use of the system must consent to be bound by the
results of the process. There are 17 district fee arbitration committees that
handle such disputes, consisting of attorneys and public members. If the fee in
dispute is $3,000 or more, a panel of two lawyers and one public member usually
hears the matter; disputes involving smaller amounts may be heard by a single
lawyer member of the committee.Filing
fees of $50 each from both the client and lawyer are required in arbitration
cases.

The fee arbitration system, which is administered by the OAE under the
supervision of the Supreme Court, operates independently of the disciplinary
system. According to the report, 90 percent of the 1,220 fee dispute cases
resolved in 2000 were accomplished through formal determinations (787) and
settlements (316). These two categories of cases involved total billings of
about $13 million, with $9.3 million the subject of formal determinations made
by the 17 district fee arbitration committees.

The committees reduced fees by $1.4 million in the 787 formal
determinations it made. In 38.1 percent of those cases, legal bills were upheld
in full. In the remaining cases, the total reductions came to just under 23
percent. Figures for fees reduced through settlements are incomplete since the
parties are not compelled to report results.

New Jersey is one of only six
states to have an operational random audit program. Under this program, trust
accounts of private practice law firms in the state are randomly selected by
computer for audit. The primary purpose of the audit is to determine whether or
not the law firm is complying with mandatory record-keeping requirements meant
to insure the integrity of clients' trust monies.

In 2000, a total of 339 audits were conducted involving private practice
law firms. Since audits began in July 1981, 6,904 random audits have been
conducted through the end of 2000. Approximately 49.45 percent or 6,565 of the
13,277 estimated law firms were audited as of 1999, the last year for which the
number of New Jersey law firms was available. Of these, 47 percent were solo
practice firms and 53 percent were larger law firms consisting of two or more
attorneys.

Analysis of the percentage of deficiency notices issued to law firms by
the random program from 1988 to 2000, shows a marked improvement overall in the
way that New Jersey law firms maintain accounting records required by the
Supreme Court. Proper trust account reconciliations increased by 15 percent.
Improper trust account designations improved by 23 percent. Maintenance of cash
receipts and disbursement books for the trust account increased by 31 percent
and 25 percent, respectively.

While designed primarily for educational compliance checks, the program
has developed a small, but significant, number of cases involving lawyer theft
and other serious financial violations. In 2000, the Supreme Court disciplined
nine attorneys detected by the random program. Of these, six were disbarred for
knowing misappropriation of clients' trust funds.